From Strategic Trade to Weaponization of Trade

Abstract

China’s growing trade and investment in South Asia have caused several concerns in India, with fears of encirclement on the rise, especially post the Chinese takeover of a 99-year long lease of the Hambantota port in Sri Lanka. China’s economic prowess has been the reason behind its increasing teeth in international relations, and this is visible even in South Asia. The primary reason behind China’s arrival at the world stage as an economic powerhouse has been its export-led growth strategy, which was enabled by globalization. However, China has utilized trade and investment not just as tools to strengthen its own economy but also to gain a strategic edge in international politics. While most of China’s trade depends on the comparative advantage it has, what is also pertinent is that China’s trade is not just economic in nature, and beyond comparative advantage, it moves to the realm of strategic trade. In the case of its trade with South Asian countries, what is also seen is a "weaponization" of trade. A clear example of this lies in China’s economic linkages with South Asia.